US President Donald Trump has pulled out of a joint statement negotiated by the leaders of seven advanced economies at a fractious G7 summit in Canada.
In their eight-page communique released on Saturday after two days of often fierce arguments, the leaders of the US, Germany, Britain, France, Japan, Italy and Canada vowed to tackle protectionism and cut trade barriers.
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But the pledge did little to bridge a growing divide among the G7 partners following Trump‘s imposition of tariffs on its allies last week and a looming threat of a global trade war.
Trump left the meeting in the Quebec resort town of La Malbaie early to head to Singapore for a much-anticipated summit with North Korea’s leader Kim Jong-un on June 12.
Shortly after, he tweeted from Air Force One that he had instructed his representatives not to endorse the communique, citing a news conference by Canadian Prime Minister Justin Trudeau as a reason.
Trudeau had said he would not hesitate to issue retaliatory measures to tariffs imposed by Trump.
“As Canadians, we are polite, we’re reasonable, but also we will not be pushed around,” Trudeau said.
Shortly before his departure, Trump had accused his G7 counterparts and other nations of “unfair” trade practices and of treating the US like a “piggy bank”.
“The United States has been taken advantage of for decades and decades,” Trump told reporters, reiterating his long-standing view that Washington has been exploited for too long by existing trade arrangements.
He said he blamed his White House predecessors going back decades and not the G7 leaders for the “unfair” trade deals.
“In fact, I congratulate leaders of other countries for so crazily being able to make these trade deals so good for their countries,” Trump said, while insisting that his relationships with Europe and Canada were “outstanding”.
He vowed, however, to get rid of what he described as “ridiculous and unacceptable” tariffs on US goods.
“It’s going to stop. Or we’ll stop trading with them. And that’s a very profitable answer, if we have to do it,” Trump said. “We’re like the piggy bank that everybody’s robbing – and that ends.”
In their communique, all the G7 leaders agreed on the need for “free, fair, and mutually beneficial trade” and the importance of fighting protectionism.
“We strive to reduce tariff barriers, non-tariff barriers and subsidies,” they said in the statement, reflecting the typical language of decades of G7 statements.
Earlier on Saturday, German Chancellor Angela Merkel acknowledged differences between the US and the six other G7 members remained, but stressed the importance to “have a commitment for a rule-based trade order, that we continue to fight against protectionism and that we want to reform the World Trade Organization”.
“This is not a detailed solution to our problems,” she told reporters. The differences in opinion have not been taken off the table.”
French President Emmanuel Macron described the joint statement as a good first step that represented the G7 nations’ desire to stabilise the situation.
“Nevertheless, I do not consider that with a declaration all is obtained and it is obvious that we will have in the coming weeks, the next months, to continue to work,” Macron told reporters.
Even before this year’s G7 summit began, the US and the other participants were on a collision course on a number of issues.
In advance of his trip to Canada, Trump fired off a provocative proposition by calling for Russia to be readmitted into the G7.
The suggestion was quickly shot down by his European allies, except for Italy.
“Canada’s position is absolutely clear. That there are no grounds whatsoever for bringing Russia with its current behaviour back into the G7,” said Canadian Foreign Minister Chrystia Freeland.
Her words echoed statements from France and Germany, with Merkel saying Russia could not be readmitted until it had made “substantial progress” on Ukraine.
G7 summed up in one photo. pic.twitter.com/TLv1wr6xrW
— Greg Hogben (@MyDaughtersArmy) June 9, 2018
But tensions had already been seething over trade after the Trump administration confirmed on May 31 it would apply additional tariffs on steel and aluminium imports from Canada, Mexico and European Union countries, ending a two-month exemption period.
In response, Canada, Mexico and the EU said they were putting in place their own retaliatory measures.
During his press conference on Saturday, Trump warned foreign countries not to retaliate against the US tariffs.
“If they retaliate, they’re making a mistake because, you see, we have a tremendous trade imbalance,” he said.
But later on Saturday, Justin Trudeau, prime minister of Canada and host of the summit, confirmed he was going ahead with his tariffs against the US in response to Washington’s moves.
Trudeau denounced Trump’s decision to invoke national security concerns to impose tariffs on aluminium and steel as “insulting” to the Canadian war veterans who had fought alongside US allies.
He also said he told Trump “it would be with regret but it would be with absolute clarity and firmness that we move forward with retaliatory measures on July 1, applying equivalent tariffs to the ones that the Americans have unjustly applied to us.”
Trump also played a wild card, suggesting that rather than both sides boosting retaliatory tariffs they could declare for entirely free trade in the G7 zone.
“No tariffs, no barriers. That’s the way it should be. And no subsidies. I even said, ‘no tariffs’!” Trump said. “That would be the ultimate thing, whether or not that works, but I did suggest it.”
The US president’s utopian idea was greeted with scepticism.
“Trump is completely incoherent,” political economist Philippe Legrain told Al Jazeera.
“He is talking about launching a global trade war; he’s taken action against his closest allies; he’s gone through a meeting where it’s six against one – and then blind-sides people by talking about abolishing tariff subsidies and other trade barriers,” said Legrain.
“I think you need to take that with a huge fistful of salt.”
Legrain said it is true that the US has a large trade deficit but added that this was “mostly because Americans consume a lot and produce less”.
Trump “is confused about both the source of the trade deficit and the consequence of the trade deficit,” said Legrain.
“He thinks that it’s due to unfair trade practices but it’s actually primarily due to the consumption behaviour of Americans. He thinks it means that, somehow, America is losing out and actually it doesn’t … The average tariff is almost the same in each country.”
Another source of disagreement has been the unilateral US withdrawal from a multinational nuclear deal with Iran.
Trump announced the move last month to the dismay of partners in Europe and beyond who were left scrambling to keep the landmark 2015 agreement in place.
The G7 statement also included joint commitments to ensure that Iran will “never seek, develop or acquire a nuclear weapon” as well as demands for Russia to stop undermining Western democracies.
Earlier on Saturday, Trump arrived late for a breakfast G7 discussion on gender equality, with Trudeau kicking off things off without waiting for those he described as “stragglers” to arrive.
“Trump came late, he’s leaving early and he gave no ground whatsoever,” Al Jazeera’s John Hendren, reporting from Quebec, said.
“The other leaders have been calling this G6 1 because Trump has been so isolated ever since this began, and that’s because he launched an outright attack – that’s in the view of the other members – on the global trading system by raising tariffs on steel and aluminium.”